The Mediating Role of Institutional Capacity and the Moderating Effect of Macroeconomic Instability on Devolved Rural Road Delivery: A Review of Systemic Barriers

Abstract

The reduction in rural marginalization of infrastructure in Africa has been achieved through the wide diffusion of the so-called fiscal deviation. According to New Institutional Economics, the provision of public resourcing at the local level is more economic since it meets the geographic specificity of infrastructure provisions. However, when intergovernmental fiscal transfers are towards rural road provision, it is majorly because of several structural impediments, that the corrected road will not be realized. This systematic review of literature with regards to devolution and infra-structure provision has laid emphasis on going beyond overly simplistic input-output models to explore the multiple filters regulating decentralized public works. The focus here is on institutional capacity as a crucial explanatory factor and the way deficits in technical engineering, equipment maintenance, and procurement governance conspire to undermine the potency of devolved funding. Moreover, the study discusses the moderating effects in the face of instability in the broader economy, illustrating how hyper-inflation and currency depreciation can deplete real infrastructure funds purchasing power and result in the erosion of the contractor attrition as observed. Finally, the review has identified systemic barriers, such as climate vulnerability and ministerial red-tape friction. The synthesis of empirical literature from 2010 to 2024 suggests that fiscal decentralisation without a built institutional capacity and insulated mechanisms against macroeconomic turbulence cannot deliver in the long run.

Keywords: {'name': 'Fiscal Devolution, Institutional Capacity, Macroeconomic Instability, Rural Road Infrastructure, Allocative Efficiency, systemic barriers'}

Authors & affiliations

Lungile Ndhlovu
Chinhoyi University of Technology

Munyaradzi Chibaro
University of Botswan

Marian Tukuta
Great Zimbabwe University

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